The Brain Drain, International Integration of Markets for Professionals and Unemployment: A Theoretical Analysis

Bhagwati, Jagdish N.; Hamada, Koichi

These are useful insights into the problem of the ‘brain drain’. However, admittedly, the analysis is overly simple and could be extended in many directions. An obvious growth-theoretic extension would be to bring in savings behavior and maximization of welfare over time for those left behind. Or, within the confines of the Hicks-Samuelson model, the analysis could be enriched to allow for remittances from the emigrated people: an argument which qualifies the conclusions in favor of permitting the brain drain. The neoclassical model could further be extended fur/y in the direction of trade- theoretic models with factor movements: the effect of the labor migration on the commodity terms of trade of the labor-losing country could be readily analyzed along the lines of the recent Jones (1967) and Kemp (1966) contributions to the welfare theory of international capital movements.



Also Published In

Journal of Development Economics

More About This Work

Academic Units
Published Here
February 6, 2013